Supreme Court Lets Stand 7th Circuit Victory for Rights of Rideshare Customers and Drivers

By declining to take up the case Illinois Transportation Trade Association v. Chicago, the Supreme Court allows customers of Uber, Lyft, and similar e-hailing services to breathe easier.


The Supreme Court today declined to take up the case Illinois Transportation Trade Association v. City of Chicago.

That's great news for Americans who want more choice and opportunity in both using and operating rides-for-hire, both in Illinois and nationwide.

Timothy Neesam (GumshoePhotos)/Foter

The trade association of Illinois cabbies was appealing an important decision from last October from the 7th Circuit Court of Appeals. In that decision, as I reported at the time, Judge Richard Posner wrote eloquently that the trade association for traditional cabs failed to make the case that Chicago's failure to regulate e-hailing services such as Uber and Lyft the same way they regulated cabs rose to the level of a violation of the cabbies' constitutional rights.

The cabbies made seven distinct claims that their constitutional rights were being violated, all of which were in Judge Posner's eyes "weak."

"Were the old deemed to have a constitutional right to preclude the entry of the new into the markets of the old, economic progress might grind to a halt," Posner wrote in that decision. "Instead of taxis we might have horse and buggies; instead of the telephone, the telegraph; instead of computers, slide rules."

The cabbies also tried to argue their constitutional right to equal protection under the law was violated by the differential regulatory treatment of cabs and e-hailing services. In response to that claim Posner wrote that "The proper question to ask regarding equal protection is whether the regulatory differences between Chicago taxicabs and [e-hailing services] are arbitrary or defensible, and the City makes a compelling case that they're the latter."

Posner went on to explain some of the relevant differences, such as the fact that customers of Uber and similar services "must sign up…before being able to summon it, and the sign up creates a contractual relationship specifying such terms as fares, driver qualifications, insurance, and any special need of the potential customer owing to his or her having a disability" and that "unlike taxicab service [an e-hail company] assumes primary responsibility for screening potential drivers and hiring only those found to be qualified, and the passengers receive more information in advance about their prospective rides—information that includes not only the driver's name but also pictures of him (or her) and of the car."

"The Constitution does not require governments to stick with outdated protectionist regulations in the face of technological innovation." said attorney Renee Flaherty in a press release from the Institute for Justice (I.J.) today when news of the Supreme Court's declining the case broke.

The Institute, as it noted in that press release, "represented ridesharing drivers who intervened in the lawsuit to make sure that their competitors did not succeed in using the courts" to shut them down and damage both them and would-be rideshare customers.

And, as I.J. notes, this decision of the Supreme Court's to let the 7th Circuit's decision stand has ramifications beyond Illinois. It "has cleared the way for transportation freedom across the country," said Institute for Justice Senior Attorney Anthony Sanders. "In city after city, we are seeing lawsuits like these filed by incumbent businesses that want to freeze the current regulatory environment in amber. And these lawsuits, rightly, are failing. Consumers and entrepreneurs, not lawyers and bureaucrats, should decide what transportation options are available."